Recently Gujarat High Court held that where Assessing Officer while placing reasons recorded for approval of Commissioner prior to issuance of notice under section 148, recorded in Form No. ITNS-10, that income which escaped assessment was more than Rs. One lakh, then statutory bar imposed against reopening of assessment under section 149(1)(b) would not operate in such a case. Facts of the case: The assessee was engaged in share trading business. For the relevant assessment year, the assessee filed its return declaring certain taxable income. The Assessing Officer completed the assessment under section 143(3). After expiry of four years, from end of relevant assessment year, the Assessing Officer initiated reassessment proceedings. The reason recorded for initiating said proceedings was that certain sources of investment had been found to be unexplained as the companies who funded the investment had been found to be bogus. The investments were also not found to be recorded in the books of account of the assessee as they were squared off during the financial year itself. The assessee challenged validity of reassessment proceedings by filing instant writ petition contending that impugned proceedings were initiated on basis of mere change of opinion The assessee contended that any notice issued beyond the period of four years is invalid unless the income has escaped assessment on account of non-disclosure of all material facts truly and fully by the petitioner. It also contended that the very issue has been in detail scrutinized by the Assessing Officer, and therefore, the notice is nothing but a change of opinion, which is impermissible under the law. It further contended that the reasons recorded also did not reflect that there is any reason to believe that the income has escaped the notice in as much as the only source reflected in the reasons is the investigation. It was held that: In light of the discussion held hereinabove, the twin conditions required for the satisfaction of the Income-tax Officer, in the event of reopening of assessment beyond the period of four years is that (i) there must be a reason to believe that income chargeable to tax had escaped assessment; and (ii) he also must have reason to believe that such escapement of income is on account of omission or failure on the part of the assessee to disclose fully and truly all material facts for assessment of the income of the assessee for the year under consideration. Thus, where the information furnished is found to be false, there could not be possibly any objection to the notice under section 148. Till completion of scrutiny assessment, the information provided mentioned clearly that investments made by the petitioner were from the funds of the companies and therefore, there was no question of treating them as bogus. However, subsequently when on investigation, after completion of assessment under sub-section (3) of Section 143, the same was found to be bogus, notice under section 148 of the Act deserves to be held to valid. To a limited extent, the Court has looked into the conclusion arrived at by the Assessing Officer in examining whether there was any material available on the record for the Assessing Officer to form a requisite belief and whether such material had any rational link with the income that escaped assessment and from such scrutiny concluded that no inference is called for at this juncture. Proceedings of reassessment initiated by the Assessing Officer on the basis of subsequent information which is found to be relevant and specific and when the Assessing Officer after recording the reasons for formation of his belief that in the original assessment, the assessee failed to disclose fully and truly facts, and therefore, the income chargeable to tax to the extent of Rs. 33.90 lakh (rounded off) escaped assessment has correctly exercised jurisdiction provided under section 147, and therefore, the petition by the assessee failed with an observation that in the reassessment proceedings, nothing observed by the Court shall come in the way of either side in putting forth their respective case and uninfluenced by such observations, the Revenue authorities shall decide the reassessment proceedings.   ITR filing for F/Y 2013-14 has started. Please check our ITR filing page